In this post, we’ll look at the pitfalls of popularity and how, while welcome, the increasing mainstream-ification of what only a decade ago would have been characterised as fringe criticisms of neoliberalism brings problems of its own.
Ten years ago, it was virtually impossible to find anything — even in the most outré parts of the internet — on the subjects of inequality, neoliberalism or the unacceptable faces of capitalism.
Now, everywhere you look there’s elite wrongdoing-this, inequality-that, neoliberal-critique-the-other. This, of course, is no bad thing. But in jumping on the bandwagon, ill-informed, poorly-researched and frankly sloppy writing creates the potential for the progressive anti-neoliberal cause to undermine itself as — and this is only a matter of time — the counterinsurgency of the vested interests in big business and big money politics take to the airwaves (or print media, or social media or wherever they think they can find an outlet) seizes on the inconsistencies of risible any-stick-to-beat-a-dog stories.
Thanks to Jerri-Lynn’s eye for a link, I was alerted to an article in which covered India’s attempts at demonetisation.
These sorts of pieces are a tad frustrating because, while they are trying to identify and — rightly — call out how the War on Cash will end up with civil liberties as collateral damage, it conflates several of the issues in play (an India-style demonetization, a nudge-theory encouragement of non-cash payments, changes in form-factors for non-cash payment such as less or mobile phone payment methods and — what is to me the worst — guilt-by-association for people paying in cash especially for big ticket transactions).
I think the War on Cash is what is sometimes referred to in psychology terms as “overly determined” — there’s multiple, overlapping drivers behind the strategy. But if, perhaps to make an attention-grabbing article or play on readers’ innate mistrust of bogeyman authorities like the central banks, writers end up pointing the finger of blame at just one actor or lump a disparate group of separate actors together and attribute their actions to a co-ordinated undertaking, they miss how initiatives like the War on Cash don’t get off the ground and are kept aloft because of just one or two vested interests.
They get the life of their own that they’ve gotten both because their outcomes sometimes align with common elite causes but sometimes also — surprisingly — despite conflicting elite agendas.
At this point its worth noting how difficult it often is for journalists to write about a topic in a different country where they don’t have first-hand experience of what is actually happening on the ground in the country concerned. It took Cfdtrade’s Jerri-Lynn Scofield an entire post to debunk a lot of the myths which had sprung up around India’s demonetisation. Most of these myths arose simply because journalists based outside of India lacked basic information which anyone who was experiencing the events would have picked up straight away.
Not surprising, then, that when GlobalResearch wrote its piece A Sinister War on Our Right to Hold Cash it risked descending into a Dave Spart-style self-parody. For those unfamiliar with Dave Spart, Dave is a fictional character created by British satirical magazine Private Eye. As the archetypal arm-chair radical thinker, Dave in his eagerness to demonstrate virtue-signalling dislike of everything not overtly of the left, frequently overemphasises the role of individuals or particular agencies. And by hopelessly misconstruing their involvement with significant issues of the day in particular, or progressive dog-whistles generally, ends up devaluing the very causes he hopes to champion by inviting — deserved — ridicule.
Everyone who seeks to pick up their keyboards and critique our established order of big money or big finance and their corruption of politics should have a picture of Dave Spart on their desks as a warning.
GlobalResearch risked descending into a Dave Spart-esque diatribe in its piece, especially when it lumped together any and every anti-neoliberal lightning-rod it could find, such as here :
What we are discussing is a plot, and it is a plot, by leading central banks, select governments, the International Monetary Fund in collusion with major international banks to force citizens—in other words, us!—to give up holding cash or using it to pay for purchases. Instead we would be forced to use digital bank credits.
But as Jerri-Lynn’s coverage showed, the Indian central bank, the Reserve Bank of India (RBI), bore the brunt of the logistical nightmare it was confronted with. The Modi government instigated the demonetisation policy, dictated the timescales to the RBI and left it to face the music of the inevitable chaos that resulted from a too-ambitious programme implemented in too-optimistic timescales.
And the IMF — — was not uncritical of India’s implementation of demonetisation. As Paul Cashin, IMF Mission Chief for India stated:
As I mentioned, the post-November 8 cash shortage is coming about because of the currency exchange initiative. We would certainly hope that action is increasingly taken, which it is, to increase cash in circulation and avoid payment disruptions. But nonetheless, we lowered our growth numbers for this fiscal and next to 6.6 percent in this fiscal year and growth will rebound a little bit to 7.2 percent in the next fiscal year. Mostly, as I said previously, these growth changes have come about due to temporary disruptions to private consumption.
This is IMF-speak for “Dear India, you screwed up your demonetisation, you took a hit to GDP because of it, now do try to clear up the mess you made.” The IMF is blaming the Indian government, rightly so, for the debacle. It is certainly not acting “in collusion with major international banks”. Cashin also clearly stated “As to key domestic risks [for India], one of them certainly stems from the government’s currency exchange initiative” (emphasis mine).
Not the central bank’s initiative, not the major international banks’ initiative, certainly not an IMF initiative — a (in this case Indian) government initiative.
India’s demonetisation has ended up boosting non-traditional banks and bank-alternatives (such as mobile phone-based payment service providers) at the expense of the big banking operations with large bricks-and-mortar retail presences in urban locations. The big banks are, on the whole, ambivalent about the War on Cash.
The central banks, too, are simultaneously both winners and losers. They might like the upsides of not having to manage the physical cash in circulation, but they are on the hook for any botched implementation of demonetisation. And the IMF, the World Bank and the like are similarly not entirely blind to the issues which the War on Cash will cause in terms of restricting growth.
The big beneficiaries of the War on Cash are the tax authorities and the surveillance or intelligence agencies.
So the War on Cash has a subtler dimension — an intra-elite conflict where certain neoliberal goals (keeping tabs on the general population and controlling their access to the payment system) can only be pursued at the expense of others (keeping big banks’ costs low and not benefitting or enabling disruptive new entrants to the cosy-cartel that is the existing payment system).
India’s attempt at demonetisation was done at the behest of the Modi administration. It was — and is — a government policy response. Ire must therefore be directed at the Indian government. If it’s focussed — wrongly — elsewhere, it serves to let Modi off the hook.
Throwing the entire gamut of left-wing bêtes noires such as central banks and the IMF into the air and hoping it all lands in a nice, neat coherent heap of an argument doesn’t help the cause. Dave Spart never convinced anyone of anything.